US billionaire Warren Buffett, said his firm National Indemnity’s $52-a-share bid for Transatlantic Holdings has expired.
The chairman and chief executive officer Nebraska-based Berkshire Hathaway told PBS television: “We made an offer about a week ago. That offer’s expired now.”
Ajit Jain, who heads Berkshire’s National Indemnity sent a letter on 5 August to Transatlantic CEO Robert Orlich that gave the New York-based reinsurer until the close of business 8 August to accept or reject the unsolicited proposal, according to a statement from Transatlantic.
Transatlantic said on Aug. 12 that it reached a confidentiality agreement with Berkshire as it seeks a better offer.
Transatlantic had already entered into a merger agreement with Allied World Assurance in June, and received a counter-bid from Validus in July.
Allied World's stock-for-stock offer valued Transatlantic at $44.22 a share on 5 August. Validus's combined cash and stock offer valued the company at $46.37 a share on the same day.
Transatlantic says the terms of the confidentiality agreement with National Indemnity are largely similar to those governing its confidentiality agreement with Allied World, and so include a standstill provision.
The standstill provision proved an obstacle to talks between Transatlantic and rival suitor Validus. Validus rejected the provision, arguing that agreeing to it would have prevented the company from taking its offer direct to Transatlantic shareholders. Transatlantic countered that the provision was necessary to protect its confidential information.
Validus is now pursuing Transatlantic's shareholders directly, bypassing the board, although it remains open to engaging with the board.